MARKET OUTLOOK
FOR FRIDAY, NOV 03, 2017
After a strong session on the previous day, the Indian Equity
Markets consolidated on Thursday as the NIFTY50 oscillated in a narrow range
while ending the day with a minor loss of 16.70 points or 0.16%. The Markets
consolidating after a sharp rise is no doubt a show of underlying strength.
However, the rather uncommon thing that is come up is that on one hand, the
NIFTY50 has tested and resisted to a 19-month old rising trend line on the
Weekly Charts; and on the other hand, a sharp rising in Open Interest along
with a decline in NIFTY indicates high addition of short positions in the
system. Friday would remain an interesting session to see if the NIFTY
continues to consolidate or the persistent show of strength results into sharp
short covering.
The resistance levels for NIFTY have now shifted to 10453 and
10565 levels. Supports shifts even lower to 10360 and 10290 zones.
The Relative Strength Index – RSI on the Daily Chart is 69.7761.
It has just crossed below the overbought area and this is bearish. The Daily
MACD continues to trade above its signal line. Though no very specific formation on Candles was observed,
the session represented a spinning-top like formation once again conveying
great deal of indecisiveness and caution among participants.
Overall, going into session
tomorrow, the breadth of the Markets continues to remain a niggling technical
worry and current high of the Markets resists to a 19-month long upward rising
trend line is also something we cannot ignore. Momentum may remain, and traders
generally have no choice but to chase the momentum. One may do so, but still
continue to maintain extremely vigil at higher levels and continue to use up
move more for protecting profits at higher levels. Markets are generally
expected to remain highly stock / sector specific in nature.
Milan Vaishnav, CMT, MSTA
Technical Analyst
(Research Analyst, SEBI Reg. No. INH000003341)
Member:
CMT Association (Formerly known as Market
Technicians Association, (MTA), USA
Canadian Society of Technical Analysts, (CSTA),
CANADA
Society of Technical Analysts (STA),
UK
+91- 70164-32277
/ +91-98250-16331
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